ReutersSEOUL (Reuters) — Nexon Co. founder Jungju Kim has abandoned plans to sell a controlling stake in its parent NXC, two sources with direct knowledge of the matter said, scuppering a potentially $16 billion deal that would have been the gaming sector’s biggest.
Kim had been looking to sell the 98.6 percent stake he and his wife hold in NXC, which in turn owns 48 percent of Tokyo-listed Nexon.
Since it emerged in January, the sales plan has been dogged by funding challenges, the intricacies of Nexon’s relationship with its biggest customer, China’s Tencent Holdings, and protectionist South Korean sentiments.
“I am not picking a preferred bidder in light of market conditions and others,” its billionaire founder said in an email sent to bidders via adviser Morgan Stanley, South Korean newspaper Joongang Ilbo reported.
The paper reported that Tencent or other tech giants had not joined the bidding, which contributed to the collapse of the deal.
Tencent’s participation was seen as key to any deal, since it owns the exclusive China license for Dungeon Fighter (DNF), Nexon’s most successful game.
Sources said this year that whoever won the bidding for NXC would have to ensure Tencent was cooperative.
Bids from South Korean gaming company Kakao and private equity firm MBK Partners fell short of the seller’s expectations, while the funding capability of Netmarble, another South Korean gaming firm, was in doubt, the paper added.
Nexon shares rose 3 percent on Tuesday in Tokyo trading. Netmarble, whose shares have been weighed down by the prospect of a Nexon deal, announced a share buyback worth 200 billion won ($169.53 million) on Tuesday, lifting its shares as much as 8.4 percent.Speech